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How to Successfully Get a Mortgage in 2017


If you've traveled in an airplane recently, you probably went through a security check at the airport.  These security checks are required by a federal law called the USA Patriot Act.  This very same law has a provision that requires mortgage companies, banks and financial institutions to document your source of funds when you buy a house or refinance a mortgage.  In short, the US government has recruited mortgage lenders in its fight against terrorism!  In fact, lenders are required by law to ask you for:

  • Exact source of funds used for your downpayment and earnest money deposit. This includes where the money came from, how it got there, when it got there and why it got there.
  • If you have large deposits in your bank account: where the money from, how it got there, when it got there and why it got there. Large deposits can be classified as any deposit representing 10% - 20% of your normal monthly income. For example, if you earn $10,000 per month, and you had a deposit for an additional $2,000 in your bank account last month, the mortgage company may be required by law to ask you to prove exactly where that money came from, how it got deposited in your account and why it was deposited there in the first place
  • If you are selling investments to use that cash for any reason related to the home purchase, you'll likely be asked to document:
    • Precisely which stock(s) or bond(s) you are selling
    • Whether the trade cleared and when exactly the funds from the investment sale got deposited into your account

Also, be sure to provide:

  • Last two months bank statements (all pages, front and back) of any account where you'll be using money for a down payment and/or earnest money deposit; and,
  • Explanation of any large or irregular deposits in those accounts

Separately, I'll send you a checklist of documents that are specifically required for your loan program.  Please reach out to me with any questions.  My goal is to make this a 5-star experience for you!